Fairfax India new issue

[SafetyinNumbers]

1 hour ago, dartmonkey said:

The recovery of IIFL Finance continues.

 

To recap, they got into some regulatory trouble in March as the Reserve Bank of India (RBI) asked IIFL FInance to stop sanctioning or disbursing gold loans after raising concerns about the company's gold loan portfolio. The share price dropped from about 600 to close to 300, and IIFL issued shares (at 300 INR) and debt, FIH participating in both. FIH now owns 15.1% of the firm, and with shares at 517.60 at the June 30 close, well up from 340.10 at the end of Q1 and 2/3 of the way back to the 600 region.

 

For FIH, the impact on Q2 results should be significant, as this represents a $137m increase in this mark-to-market stake, reversing most of the $178m Q1 loss, for a gain of almost exactly $1 per FIH share.

 

Most of FIH's book value is in the Bangalore Airport, and there are other private investments like Sanmar Chemical, 7 Islands Shipping and Maxop Engineering. But looking at the five big public investments, worth about a third of FIH's total book value, they seem to have all gone in the right direction. Ignoring USD:INR (which stayed at exactly 83.7), FIH's 5 biggest public investments were up 30% in total:

 

 

 

Q2 report was August 3rd last year, so I guess we'll know in about 4 weeks, but it looks like results should be dramatically better than Q1.

 

 

 

Thanks for tallying up the quarterly gains, @dartmonkey. 
 

This should make a decent difference to FFH’s Q2 results as well. 

[dartmonkey]

58 minutes ago, SafetyinNumbers said:

Thanks for tallying up the quarterly gains, @dartmonkey. 
 

This should make a decent difference to FFH’s Q2 results as well. 

 

Fairfax gives FIH a carrying value of $1971m at March 31st, and a 'fair value' of $3083m. Note 5 in the Q1 report (p.9) shows that this is just the sum of cash, bonds, commons stocks and the carrying value of investments in associates (primarily the airport), $1426m, with a fair value of $2538.

 

But does anyone know how they come up with that carrying value? Note 2 on p.47 of the Q2 report suggests that this is just equity ("The adjusted carrying value of each subsidiary represents its total equity as included in the company's interim consolidated financial statements for the three months ended March 31, 2024, less the subsidiary's non-controlling interests as included in note 12 (Total Equity) to those interim consolidated financial statements."), but FIH's equity is much higher than the share price, so I don't understand how they are calculating the carrying value of FIH.